The Energy Minister Fran Logan says companies can bid for any lot within the area, if they believe it has good potential for geothermal energy.

"It is expensive, so whoever is going to take on these projects needs to bear that in mind," he said.

"It's going to be long term, and of course once you've found the geothermal energy and you make use of it through water injection processes for steam, then you've got to construct a power station and connect it to the transmission."

Mr Logan says he expects geothermal energy to play a significant role in the future.